Buying property in a recession: Are you wise or foolish?
The announcement made earlier in June that South Africa has slipped into recession has left many homeowners and prospective buyers in a state of uncertainty. Will house prices tank? Will homeowners slip into negative equity? Should buying plans be put on hold?
Crispin Inglis, CEO of PropertyFox, says there is no ‘one-size-fits all’ answer because so much depends on an individual’s own circumstances.
“It’s hard for anyone to ignore how tough it is out there, and every time you set foot in a grocery store your bill seems to have leapt by 10%,” says Inglis.
“Interest rates are high, unemployment is at staggering levels and no one knows when things will start to look up. So anyone currently thinking of entering the property market or expanding their portfolio needs to move forward with great caution, after having considered their financial picture fully.”
Using Privyseal to protect property consumers
Since the Estate Agency Affairs Board made the use of Privyseal mandatory for registered estate agents over 3 million EAAB Privyseals are now displayed monthly.
Privyseal is a digital seal that authenticates the registration status of registered estate agents in real-time and which is added to an estate agent’s e-mail signature, website, property profiles and listings on the various property portals.
The Privyseal, by reflecting the registration status and qualifications of estate agents, enables consumers immediately to gauge an estate agent’s level of knowledge, experience and expertise.
Consumers can also ascertain the current registration status of an estate agent given that estate agents may be interns, full status non-principals, full status non-principals who have earned the designation of Professional Practitioner in Real Estate (PPRE), principal estate agents, or principal estate agents who have earned the designation Master Practitioner in Real Estate (MPRE).
Standard Bank launches Provincial and Regional House Price Indices
Standard Bank, the biggest home loan provider in the country, has launched two new house price indices that provide key insights into regional and provincial market trends across the country.
The Provincial House Price Index (PHPI) and Regional House Price Index (RHPI) will supplement the existing monthly National House Price Index, but break new ground by providing rich data into the trends underlying residential property movements in the different regions and measuring the median prices of properties sold. The advantage of a median is that it is not unduly influenced by extreme values and outliers.
“Our Provincial House Price Index (PHPI) and Regional House Price Index (RHPI) aim to provide a more comprehensive analysis of residential property in South Africa through regional price differentiation,” explains Andrew van der Hoven, Head of Home Loans at Standard Bank.
Understanding the ‘who’s who’ of property transactions
House hunting may seem like a relatively simple process that can easily be done online, but there is much more to a property transaction than you may think according to Gerhard van der Linde, MD of Seeff Pretoria East, who says aside from the listing and marketing, a mutually acceptable deal needs to be negotiated and then, there is a whole chain of events that follow and involve many role players before ownership of the property is finally transferred.
These role players include:
If divorce pulls you apart, who gets the property?
The South African divorce rate is over 50%, and in most cases the primary asset, beside the question of the welfare of any children that need to be shared in these matters, is an immovable property.
“For many South Africans a property is the biggest investment they’ll ever make and as such it makes sense that it is the largest asset that needs to be divided when couples separate,” says Bruce Swain, CEO of Leapfrog Property Group.
How assets, including property, are divided during a divorce depends on what marriage regime, or type of marital contract, the couple registered when they were married.
Eight rookie mistakes that keep your home from selling
If your home is struggling to catch the eye of a buyer, it could be for an entirely valid reason according to Elaine Chetty, Licensee of Seeff Richards Bay, who heads a team whose average age is 32 years, and who recently received the Seeff Chairman’s Award for KZN from Samuel Seeff.
“Maybe you're stuck in a sluggish market or have the poshest place on the street, always a tough sell - but there's another possibility, too: your home could be sitting on the market because of a rookie selling mistake,” says Chetty.
“All of us can make them, even those of us who actually have a few home sales under our belts.”
Chetty says that these basic slip-ups can easily be corrected or avoided, and lists some of the most common mistakes people make in trying to sell their home.
Steer clear of these to avoid sabotaging your own sale: